Unlocking the India-Pakistan gridlock
The only Indian invited to the swearing-in ceremony of Imran Khan as Pakistan’s new prime minister earlier this month was Navjot Singh Sidhu, a former swashbuckling batsman-turned-showman-turned-politician. Despite his multiple talents and avatars, Sidhu was there only because he had been a cricketing contemporary of Khan, and the two had played quite a few matches against each other.
Both Khan and Sidhu expressed their desire for the resumption of cricketing ties between India and Pakistan, two of the greatest teams and rivals of the game, and whose matches have more intensity and following than the England-Australia’s Ashes. However, the two sides have not played any cricket against each other for nearly two decades, except in the World Cup and other international series.
The time may be ripe for the game to restart, and by reinitiating sports, the two governments would definitely clear the air to some extent and diminish the demonization of each other in their respective countries. Despite the rivalry between the nations and their teams, matches between India and Pakistan have always drawn a full house.
Boosting trade and commerce is another area that need not be extremely complex for the two sides to handle. Despite being the two largest neighbors in South Asia, bilateral trade was a mere $2.7 billion last year, less than 0.4 percent of India’s total trade last year. The potential is immense. Various estimates peg ideal trade to be anywhere between $20 billion and $40 billion.
New Delhi’s relations with Islamabad appear frozen in time, with absolutely no progress in years. With a new government in charge in Pakistan, the two countries may be better off rebuilding ties in areas such as the economy, trade and cricket, rather than wait for politics to break the deadlock.
Ranvir S. Nayar
Some of this may actually be taking place. Exporters from both the countries are known to reroute goods through third countries, notably the UAE, so actual trade between India and Pakistan may be higher. But rerouting goods through third countries makes trade more expensive and time-consuming.
Direct trade is currently extremely hampered, with all kinds of tariff and non-tariff barriers erected on both sides. Traders often complain of the constant harassment they have to go through.
For instance, most Indian exports to Pakistan attract punitive levels of duties, even though India has granted Pakistan the status of Most Favored Nation, which means imports from Pakistan would be treated in a nondiscriminatory fashion. More than 20 years later, Pakistan has failed to return the favor, citing fears of Indian goods flooding Pakistan and destabilizing its economy.
Despite these issues, the margins in bilateral trade remain attractive, and the popularity of Pakistani products in India and vice versa have ensured that bilateral trade has increased nearly 10-fold from the 2002 levels. With India the fastest-growing large economy in the world, it is in Pakistan’s interest to ensure that its exporters do not miss out on this immense market.
Thanks to the projects underway as part of the China-Pakistan Economic Corridor (CPEC), Pakistan’s basket of exports to India — currently limited to textiles, handicrafts, agricultural products and cement — is set to add a number of other items, thus significantly enhancing Pakistan’s capacity to maintain a degree of balance in liberalized bilateral trade.
Another factor favoring enhanced bilateral trade is that the two nations share a large border, so the cost of transportation is extremely low. They could also look at enhancing people-to-people contacts and cultural exchanges. These actions would go a long way to removing mutual fear and mistrust.
As obvious as these measures may be for normalizing ties, the leaders on both sides may find it difficult to take even baby steps, at least in high-profile activities such as cricket. Any such action is bound to raise the hackles of nationalist groups on both sides.
In India, the ruling Bharatiya Janata Party (BJP) and its mother organization, Rashtriya Swayamsevak Sangh (RSS), are bound to violently oppose any such steps. The reception in Pakistan is also likely to be less than warm.
So whatever the two nations do, they have to work quietly and away from the limelight. Easing certain visa rules or taking steps to facilitate bilateral trade are essentially bureaucratic decisions that can be implemented subtly. They should also be shielded from political storms or the ups and downs that the relationship frequently witnesses.
Both societies are bound to benefit from enhanced trade and cultural exchanges, and once these ties have improved to a certain degree, they can play a role in resolving the more complex political and security issues.
• Ranvir S. Nayar is managing editor of Media India Group, a global platform based in Europe and India, which encompasses publishing, communication, and consultation services.
